nep-mkt New Economics Papers
on Marketing
Issue of 2013‒08‒05
six papers chosen by
Joao Carlos Correia Leitao
University of Beira Interior and Technical University of Lisbon

  1. Search Engine Optimization: What Drives Organic Traffic to Retail Sites? By Michael R. Baye; Babur De los Santos; Matthijs R. Wildenbeest
  2. The Impact of Cultural Symbols and Spokesperson Identity on Attitudes and Intentions By Lenoir, A-S.I.; Puntoni, S.; Reed II, A.; Verlegh, P.W.J.
  3. Platform Competition under Dispersed Information By Bruno Jullien; Alessandro Pavan
  4. Ecolables: A Green Sustainability Recital in Marketing- An Empirical Framework By Smita Shingrup
  5. Merchant steering of consumer payment choice: lessons learned from consumer surveys By Oz Shy; Joanna Stavins
  6. A nonlinear product differentiation model à la Cournot: a new look to the newspapers industry By Mercedes Esteban Bravo; José Manuel Vidal-Sanz

  1. By: Michael R. Baye (Department of Business Economics and Public Policy, Indiana University Kelley School of Business); Babur De los Santos (Department of Business Economics and Public Policy, Indiana University Kelley School of Business); Matthijs R. Wildenbeest (Department of Business Economics and Public Policy, Indiana University Kelley School of Business)
    Abstract: The lion’s share of retail traffic through search engines originates from organic (natural) rather than sponsored (paid) links. We use a dataset constructed from over 12,000 search terms and 2 million users to identify drivers of the organic clicks that the top 759 retailers received from search engines in August 2012. Our results are potentially important for search engine optimization (SEO). We find that a retailer’s investments in factors such as the quality and brand awareness of its site increases organic clicks through both a direct and an indirect effect. The direct effect stems purely from consumer behavior: The greater the brand equity of an online retailer, the greater the number of consumers who click its link rather than a competitor in the list of organic results. The indirect effect stems from our finding that search engines tend to place better-branded sites in better positions, which results in additional clicks since consumers tend to click links in more favorable positions. We also find that consumers who are older, wealthier, conduct searches from work, use fewer words or include a brand name product in their search are more likely to click a retailer’s organic link following a product search. Finally, the brand equity of a retail site appears to be especially important in attracting organic traffic from individuals with higher incomes. The beneficial direct and indirect effects of an online retailer’s brand equity on organic clicks, coupled with the spillover effects on traffic through other online and traditional channels, leads us to conclude that investments in the quality and brand awareness of a site should be included as part of an SEO strategy.
    Keywords: search engine optimization, organic clicks, search marketing
    JEL: L0 D43 D83 L13
    Date: 2013–05
  2. By: Lenoir, A-S.I.; Puntoni, S.; Reed II, A.; Verlegh, P.W.J.
    Abstract: In today’s multicultural societies, ethnic targeting is increasingly important for marketing. Two main approaches to target ethnic minorities have emerged: messaging consumers when their ethnic identity is most salient, and featuring spokespeople who have the same heritage as the target. We conduct replications of two articles representative of these research streams: Forehand and Deshpandé (2001) and Deshpandé and Stayman (1994). Our findings identify generational status as an important boundary condition for these ethnic targeting strategies.
    Keywords: advertising;ethnicity;identity;minority targeting
    Date: 2013–07–23
  3. By: Bruno Jullien; Alessandro Pavan
    Abstract: We study monopolistic and competitive pricing in a two-sided market where agents have incomplete information about the quality of the product provided by each platform. The analysis is carried out within a global-game framework that offers the convenience of equilibrium uniqueness while permitting the outcome of such equilibrium to depend on the pricing strategies of the competing platforms. We first show how the dispersion of information interacts with the network effects in determining the elasticity of demand on each side and thereby the equilibrium prices. We then study "informative" advertising campaigns that increase the agents’ ability to estimate their own valuations and/or the distribution of valuations on the other side of the market.
    Date: 2013–05–01
  4. By: Smita Shingrup
    Abstract: Environmental sustainability is not simply a matter of compliance or risk management. People are concerned about the environment and marketers have to begun to modify their practices in an attempt to attract consumer’s new concern. Marketers are increasingly recognizing that the many competitive advantages and business opportunities to be gained from Eco Sustainability and Green Marketing. Key words: Ecolabels, Green Marketing
    Date: 2013–06
  5. By: Oz Shy; Joanna Stavins
    Abstract: Recent policy changes allow merchants to influence consumers’ choice of payment instruments by offering price discounts and other incentives. This report describes lessons learned from using consumer survey responses to assess whether merchants tried to influence buyers’ choice of payment method. To measure the effects of these recent policy changes, we included questions about merchant steering in pilot versions of a new diary survey of U.S. consumers. Our findings are inconclusive because some respondents interpreted the questions differently from the way we intended. This report aims to explain why the diary survey failed to deliver the desired results, and to suggest better ways to use surveys to evaluate the effects of policy changes in the future.
    Keywords: Payment systems ; Consumers' preferences ; Consumer surveys ; Credit cards ; Debit cards
    Date: 2013
  6. By: Mercedes Esteban Bravo; José Manuel Vidal-Sanz
    Abstract: In this work, we develop a new model for competition in markets with differentiated products. In addition, we present a consumer model designed to produce a flexible nonlinear inverse demand system that resembles the classical Multinomial Logit model, and discuss several extensions. We characterize firms competition in quantities based on the inverse demand system. The model is applied to the Spanish newspaper industry. This is a highly competitive two-sided market whose revenues are generated from sales and to a larger extent from advertising driven by its circulation. We then characterize the Perfect Equilibrium by conditional moment conditions, and estimate the parameters using the Generalized Method of Moments
    Keywords: Newspapers, Differentiated products, Dynamic equilibrium, Generalized method of moments, Advertising expenditure, Time series, Persistence, Cointegration, Structural changes
    Date: 2013–07

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